Case Study - Grub Club

CASE STUDY - GRUB CLUB DOG FOODS

‘There’s a serious opportunity here’

With venture capital funding, a classroom project to develop eco-friendly dog foods made the leap into the commercial realm

OFFERING YOUR DOG a nutritional superfood made from insect protein instead of conventional meats has a number of surprising benefits.

Firstly, it’s fantastic for the environment. Given that livestock farming helps to drive deforestation and climate change, it’s sobering to learn that pets consume a fifth of the world’s fish and meat.

What Grub Club’s co-founders didn’t initially realise, however, was just how dramatically their products would transform the lives of the dogs themselves. That’s because canine allergies are common and are often linked to eating beef, chicken and similar foodstuffs.

“Some of the testimonials we share online are just amazing,” says Alessandro Di Trapani, who co-founded Grub Club with trained chef Hugh Petit.

“A customer told us that her dog’s allergies were so severe, the vet suggested putting the animal down. She made the swap to our food and now her Shar Pei has a new lease of life. It’s healthier than ever.”

Gathering momentum

The inspiration for Grub Club came while Alessandro and Hugh were studying for their MBAs at London Business School.

“It was for an entrepreneurship class,” says Alessandro, “and it was all born out of an article in The Wall Street Journal, where someone in the United States was building a similar business. She wanted to become the Beyond Meat of the pet food industry.”

During their research, the pair discovered that pet owners were feeding their animals high-quality, human-grade cuts of meat, “which is bonkers from a sustainability point of view. So, we started to look at how we could solve this problem.”

Vegan diets for dogs are controversial, and lab-grown meats are prohibitively expensive. “The alternative is insect protein, which is gathering massive momentum globally, especially in markets like pet food, aquaculture and livestock feed,” says Alessandro.

“We spent the tail end of 2020 and the best part of 2021 understanding the market, surveying as many customers or potential customers as possible and understanding their perceptions of insect protein.

“All of this is great, but without the money to launch a business, it would just remain a classroom project. Then we realised, ‘There’s a serious opportunity here – I’m going to need to raise some capital to bring this business to life.’

“I’m fortunate enough to have a network in the UK, but most of my network is back home in South Africa, so raising capital here was a daunting task.”

The two men established that their best bet was to raise equity via the SEIS and EIS tax schemes. “The focus was on trying to find angel investors who would be interested in the proposition. The tax breaks on offer are a huge incentive,” says Alessandro.

The breakthrough came after he explained the start-up’s challenges to Swoop’s head of equity, Neil Dillon, who’d been on the same MBA programme.

“Neil passed our pitch deck on to a few SEIS and EIS funds, who we then decided to pitch to. We were fortunate enough to get a couple of term sheets out of the process, and then went with the fund who we’re currently working with.”

Now Grub Club’s successes are mounting up. “We’ve been unlocking a lot of growth with our subscription model online, we’re continually adding new products to our portfolio, like dental sticks, and we recently launched a retail partnership with Daylesford Organic. So yeah, things are moving in the right direction.”